Customer confidence slides amid political upheaval

Overall consumer confidence declined three points month on month in August to -14, down from -7 during the same month in 2018, according to the GfK Consumer Confidence Barometer.

Customer confidence in the general economy over the next 12 months recorded the most significant decline, falling six points month on month to -38 and down from -26 year on year.

Shopper confidence in their personal finances over the coming year fell five points to 2 month on month, and down from 8 compared to last August.

Consumer confidence in personal finances and the general economy over the previous year both registered two-point declines month on month, down to -1 and -34 respectively.

Shoppers’ inclination to make significant purchases fell three points in the month to 1, while the savings index registered a four-point decline to 21.

GfK client strategy director Joe Staton said: “Until Brexit leaves the front pages – whenever that will be – consumers can be forgiven for feeling nervous not just about the wider economy but also about their financial situation.

“That’s an important distinction because a significant development in August is the sudden drop in views on personal finances ‘over the next 12 months’ after the encouraging jump in this measure last month.

“For a long time, the downward momentum in the overall index score has been associated with our views on the economy. But reduced confidence is now affecting how we see our personal finances.

“If there is a continuation of that dip in our feelings about our ‘future wallets’, we’d quickly see a headline score (the average of our five sub-measures) crash to a level that approaches the worrying figures seen in the worst days of the 2008/2009 financial crisis. We are not there yet, and we may not necessarily get there, but it’s a trend we need to watch carefully.”